What is socialism?

On both sides, lots of pundits are bandying the word "socialism" about: first with the bailout plan "socializing" the banks; then with Barack Obama telling Joe the Plumber that it was a good thing to "spread the wealth around." But it seems like no one has taken the time to explain what they mean by socialism. Just that there is a general notion that it involves the government using taxpayers' money.

From the little reading that I have done on the subject, this seems simplistic in the extreme. However, there is a wide spectrum to the notion of socialism as befits a complicated economic system with over a century's worth of thought and practice behind it. These thoughts below are based on the crudest definitions of the term based on some brief Googling on the topic.

Is socialism when the government owns the means of production? That's one rather simple definition, which certainly doesn't seem to be broadly applicable even to the bailout plan. The banks, as far as I can tell, are still publicly owned, though of course the stock values have sunk. I don't pretend to understand what is going on with the bailout plan, but it only resembles this form of socialism in the most limited way.

Is it worker-owned collectives? That's another quickie definition, which certainly doesn't sound anything like either the bailouts or this "spread the wealth around" notion.

Is it a focus on publicly owned rather than private property? It seems like the notion of private property is still a very strong one, even in the midst of floating plans about helping people facing foreclosure. There's never been a suggestion that the government would then own people's houses, as far as I've been able to determine.

I think Colin Powell spoke eloquently on the difference between socialism and taxation in this interview after his interview endorsing Barack Obama.

I wonder if part of the bogeyman imagery of socialism comes from the political radicalism that characterized socialism in the United States, such as Eugene Debs in the early 20th century.

At any rate, be aware of these cheap shots about socialism. I think most people making them are just bandying the word about without having any idea what it means.

More tax plan graphs

Today's Freakonomics column in the NY Times compares different graphs on the candidates' tax plans and also directs you to another website from the non-partisan Tax Policy Center that gives you raw numbers.

More on tax plans

I wrote that I'd keep an eye out for more on the candidates' tax plans. I posted an update here with a graphic from the Washington Post.

Comparing tax plans

OK, here's something I know absolutely nothing about and wouldn't begin to know how to analyze. I do know that both Obama and McCain have said, "My plan is better than the other guy's."

Here's what they say.

from Obama's acceptance speech:

Change means a tax code that doesn't reward the lobbyists who wrote it, but the American workers and small businesses who deserve it. You know, unlike John McCain, I will stop giving tax breaks to companies that ship jobs overseas, and I will start giving them to companies that create good jobs right here in America. I'll eliminate capital gains taxes for the small businesses and start-ups that will create the high-wage, high-tech jobs of tomorrow. I will cut taxes -- for 95 percent of all working families, because, in an economy like this, the last thing we should do is raise taxes on the middle class.

From McCain's acceptance speech:

"We believe -- we believe in low taxes, spending discipline, and open markets. We believe in rewarding hard work and risk-takers and letting people keep the fruits of their labor...I will keep taxes low and cut them where I can. My opponent will raise them. I will open new markets to our goods and services. My opponent will close them. I will cut government spending. He will increase it. My tax cuts will create jobs; his tax increases will eliminate them."

Now, as I said, I don't know how to analyze this, so what you think of this may depend on what you think of Business Week that has this article comparing the two plans. Here's what they say:

So where does the reality lie? According to a new analysis by the nonpartisan Tax Policy Center, a joint venture between the Urban Institute and the Brookings Institution, two Washington think tanks, this round goes to Obama. The TPC took a look at the various tax proposals put forth by the two candidates and estimated that Obama's plan would lead to a boost in aftertax income for all but the highest earners, while taking a smaller bite out of government tax revenues than would McCain's plans.

I encourage you to read the entire article. And I'll keep an eye out for more details.